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Competing bills deal with 2025 sales tax expiration

May 2, 2022 GMT

BATON ROUGE, La. (AP) — Competing ideas on what to do about the impending end of a 0.45% state sales tax — and the more than $420 million it generates annually — are on the way to the Louisiana House of Representatives.

The seven-year tax was approved in 2018, ending a decade of short-term, patchwork budget fixes through former Republican Gov. Bobby Jindal’s tenure and in the first year of Democratic Gov. John Bel Edwards’ term.

The tax is set to expire in mid-2025 — the beginning of the state’s 2025-26 fiscal year.

One bill approved Monday by the House Ways and Means Committee would start phasing the tax out next year. Its sponsor, Rep. Tony Bacala, said that gives lawmakers a chance to avoid a sudden $400 million-plus drop in revenue in mid-2025.

“Would you rather have a gradual adjustment or a steep cliff?” asked Bacala, a Prairieville Republican.

The bill reduces the 2018 tax to 0.3% next year, then 0.15% in 2024.

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The other measure approved for House debate Monday was brought by Baton Rouge Republican Rep. Rick Edmonds, It would dedicate the revenue from the tax through the next three years to a new Mississippi River bridge in Baton Rouge, an Interstate 10 bridge in Lake Charles and expansion of the Interstate 49 South corridor.

With committee members noting that other funding sources might be used for the projects, and pointing other road and bridge needs around the state, Edmonds said he’s amenable to working on amendments to the bill as it progresses.